Abstract

Although individual innovation and education economics are analyzed in many publications separately, the mechanism of how education influences individual innovation is missing. We analyze individual innovation for 2,078 employees in 3,976 value engineering projects (VEPs) over 6.5 years and build multilevel models to explain how education measured by earned degrees of employees improves innovation performance. Activeness, creativity and teamwork act as mediators and then contribute to enhance individual innovation performance, measured by three indicators: 1) the total number of VEPs which the employee proposed as an applicant, 2) the total numbers of VEPs which the employee joined as either an applicant or a follower, 3) the total number of patent applications from the VEPs which the employee joined. This mediation effect is statistically significant in two models whose dependent variables (DVs) are the first and second indicator respectively and there is direct association in the third model whose DV is the third indicator. This triangulation shows how education has a positive relationship with individual innovation performance with reliability and validity. We show that employees in science or engineering are more innovative, which contributes to explain the “engineer dividend” in China and how managers can improve innovative practices.

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